U.S. Cannabis Spot Index — September 13, 2019

U.S. Cannabis Spot Index — Published September 13, 2019

U.S. Cannabis Spot Index up 1.1% to $1,389 per pound.

 

The simple average (non-volume weighted) price increased $4 to $1,600 per pound, with 68% of transactions (one standard deviation) in the $854 to $2,347 per pound range. The average reported deal size declined to 2.1 pounds. In grams, the Spot price was $3.06 and the simple average price was $3.53.

 

The relative frequency of trades for outdoor flower increased by 1% this week. The relative frequency of transactions involving indoor product decreased by the same proportion, while that for greenhouse flower was stable. Greenhouse product’s share of the total documented weight moved nationally contracted by almost 3% this week. The relative volumes of warehouse and outdoor flower grew by about 2% and 1%, respectively.

 

 

The U.S. Spot Index rose by 1.1% this week to settle at $1,389 per pound. Upticks in the weekly composite prices of Colorado, Oregon, Washington, and Nevada, as well as the mid-sized markets of Michigan, Massachusetts, and Illinois, outweighed declines in California and Arizona.  

 

The opening half of September has seen the U.S. Spot level off a bit just below its current annual peak of $1,404 per pound, documented in the final week of August. While the behavior of wholesale cannabis prices in the weeks ahead depend largely on the fall harvest, it must be noted that available historical sales data from both adult-use and medical markets indicates that demand tends to subside in the period from September through November. Still, as we point out in regard to Colorado, lower demand in the coming months could still be stronger relative to that observed in the same period in recent years.

The national volume-weighted price for flower to be sold to general consumers jumped this week as nearly every market in which adult-use sales are taking place saw rates for such product increase, with Alaska the only exception. Prices for medical flower slipped again this week, primarily on decreases in that sector of the market in California, as well as in Arizona, New Mexico, Rhode Island, and some other smaller medical-only markets. 

 

October Forward unchanged at $1,200 per pound. The average reported forward deal size was 47 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 58%, 26%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 43 pounds, 44 pounds, and 63 pounds, respectively.

 

At $1,200 per pound, the October Forward represents a discount of 13.6% relative to the current U.S. Spot Price of $1,389 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • Number of Active Cultivation Licenses Up Over 25% From July After Changes to Provisional Licensing
  •  
  • Colorado

    July Sales Once Again Set New Record in State’s Legal System as Unprecedented Demand Drives Up Wholesale Prices

  • Oregon

  • Demand Reached New Heights in August But Illnesses and Deaths Linked to Vaping Could Dent Sales this Month
  •  
  • Washington

  • Upward Trend in Prices That Persisted from April Appears to be Leveling Off
  •  
  • Massachusetts

  • Corruption and Other Allegations Could Prevent About a Dozen Businesses Seeking Licenses from Entering State’s Growing Adult-Use Market

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

13 September 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — September 6, 2019

U.S. Cannabis Spot Index — Published September 6, 2019

U.S. Cannabis Spot Index down 2.2% to $1,374 per pound.

 

The simple average (non-volume weighted) price decreased $10 to $1,596 per pound, with 68% of transactions (one standard deviation) in the $845 to $2,346 per pound range. The average reported deal size was nominally unchanged at 2.2 pounds. In grams, the Spot price was $3.03 and the simple average price was $3.52.

 

The relative frequency of trades for outdoor flower increased by 1% this week. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for indoor flower was stable. Warehouse product’s share of the total documented weight moved nationally contracted by about 3% this week. The relative volumes of greenhouse and outdoor flower each expanded by over 1%.

 

 

The U.S. Spot Index declined by 2.2% this week to settle at $1,374 per pound. Decreases in the weekly composite prices of California and Washington State lifted the national average, outweighing small increases in the Spot rates of Colorado, Oregon, and Nevada. However, even as overall prices slipped in California and Washington, the volume-weighted rates for indoor flower in both of those states ascended to new annual peaks this week. 

 

Turning to some of the country’s mid-sized markets, Massachusetts, Illinois, and New Mexico all saw upticks in their Spot prices this week. Complete August sales figures have yet to be published for Massachusetts’ adult-use market, but demand has been climbing all year with only about a dozen producers licensed to generate supply for general consumers. Local zoning issues in Illinois are raising the possibility that the maximum of 110 adult-use storefronts may not be able to open as smoothly as some anticipated come 2020, which would stymie access and demand in the licensed system somewhat.

The national volume-weighted price for flower to be sold to general consumers was essentially flat this week, as declines in Washington State and Nevada slightly outweighed modest increases in the other adult-use markets. 

 

Prices for medical flower slipped after a significant rise last week, mainly on a sizeable week-over-week decrease in rates reported in that sector of California’s market. Several of the small East Coast medical cannabis markets also saw declines in their Spot Indices this week.

 

March 2020 Forward initially assessed at $1,225 per pound.

 

The average reported forward deal size was 45 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 59%, 24%, and 17% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 43 pounds, 40 pounds, and 63 pounds, respectively.

 

At $1,200 per pound, the October Forward represents a discount of 12.6% relative to the current U.S. Spot Price of $1,374 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • State Spot Index Averaged Over $1,250 Per Pound in August, the Highest Monthly Price Observed in 2019
  •  
  • Colorado

    Summer’s Upward Trend in Wholesale Prices Continued to Open September as State Spot, Rates for Indoor and Greenhouse Flower, All Climbed to New Annual Highs

  • Oregon

  • Wholesale Price Recovery Persisted in August, but Rate of Upward Momentum Slowed
  •  
  • Washington

  • Volume-Weighted Prices for Indoor and Outdoor flower Rose to New Year-to-Date Peaks this Week
  •  
  • New Mexico

  • Official Data Shows Production Expanded in Q2 Due to Increase in Allowed Plant Count; State Spot Index Decreased in that Period as Supply Outpaced Demand

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

6 September 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — August 30, 2019

U.S. Cannabis Spot Index — Published August 30, 2019

U.S. Cannabis Spot Index up 4.0% to $1,404 per pound.

 

The simple average (non-volume weighted) price increased $48 to $1,605 per pound, with 68% of transactions (one standard deviation) in the $858 to $2,353 per pound range. The average reported deal size was 2.2 pounds. In grams, the Spot price was $3.10 and the simple average price was $3.54.

 

The relative frequency of trades for indoor flower increased by over 1% this week. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for outdoor flower was stable. Outdoor product’s share of the total documented weight moved nationally contracted by 3% this week. The relative volumes of warehouse and greenhouse flower expanded by 1% and 2%, respectively.

 

 

The U.S. Spot Index rose by 4% this week to settle at $1,404 per pound. This week’s national composite price represents a new annual peak and is the highest observed since the opening week of 2018.  

 

As shown in the chart above, the generally upward trend in wholesale prices documented in the country’s four major legal cannabis markets is persisting as summer draws toward a close. New tax data out of California, discussed below, shows that the amount of demand being captured by the Golden State’s licensed system increased significantly in Q2. 

 

Downward trends in wholesale rates in the secondary markets of Nevada and Michigan have not been enough to stem the positive momentum of the U.S. Spot. Nevada’s market is close to the size of Oregon’s in terms of retail revenues generated in recent months. However, we estimate that significantly more flower is traded wholesale in Oregon compared to Nevada.

The national volume-weighted price for flower to be sold to general consumers rose this week on increases in all four major markets, as well as Alaska, which outweighed a decline in Nevada. 

 

Prices for medical flower jumped this week to their highest point in the quarter. Rates for product designated for registered patients were on the rise in California, Massachusetts, Illinois, and New Mexico, as well as some smaller markets.

 

September Forward closes up $35 to $1,325 per pound.

 

The average reported forward deal size was 46 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 59%, 25%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 43 pounds, 40 pounds, and 63 pounds, respectively.

 

At $1,325 per pound, the September Forward represents a discount of 5.6% relative to the current U.S. Spot Price of $1,404 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • Q2 Cannabis Tax Data Shows Retail Sales Up Roughly 18% from Q1, Volume of Flower and Trim Transferred Wholesale Both Up by About 38% Each
  •  
  • Colorado

    Denver Health Official Provides More Details on Contaminant Assessment of Products on Retail Shelves

  • Oregon

  • QTD Spot Index Up About 50% Compared to Q2’s Average Composite Price
  •  
  • Michigan

  • Sales in Medical Cannabis Market Expanding Steadily, But Suspension of Testing Lab Raises Questions About Possible Supply Bottleneck
  •  
  • New Mexico

  • New Plant Count Limit Went Into Effect This Week, Producers Now Limited to 1,750 Mature Plants, Down from 2,500

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

30 August 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved